Logan’s Roadhouse in Nashville Files Chapter 11 Bankruptcy

by San Antonio Attorney

Logan’s Roadhouse restaurant in Nashville sought for Chapter 11 bankruptcy protection on Aug. 8 with plans to reorganize its operations and shut down 18 branches, according to reports.

Logan’s CEO, Sam Borgese, will step down, but the replacement has not been named.

The casual dining restaurant chain said that its bondholders and first-lien lenders will provide $25 million financial support for its reorganization plan in bankruptcy.

According to court papers filed, the restaurant is experiencing poor sales because of low foot traffic.   Logan’s said that their business is affected by customers’ discretionary income.

Logan’s employs 18,964 people, where 1,002 are full-time employees.  The restaurant chain has 234 locations owned by the company and 26 franchised locations.

The company also included in its plan to give assistance to workers of closed restaurants, reassigning workers to other locations, and giving them outplacement support and help with finding new jobs.

Logan’s declared an estimated $416 million in debts and nearly all of it is secured, as stated in the court documents.

In 2015, Logan’s made over $606 million in revenue and $112 million losses before earnings, taxes, interest, amortization, depreciation and others.

The restaurant was founded in Lexington, Kentucky in 1991.  It went public in July 1995 and was bought by Cracker Barrel chain four years later.

The company is owned by LRI Holdings since 2006.  Kelso & Co.  controls the restaurant operator, according to a court papers filed.

The owners reportedly finalized a debt exchange in 2015 that reduced yearly debt payments by $18.5 million, yet it was not enough.  During the first half of 2016, sales dropped by 4% and foot traffic decreased by 8.8%.

Many long-standing businesses hit hard times.  That is a reality of entrepreneurship.  If your business is debt-laden and failing, talk to a Debt Relief Attorney, who specializes in bankruptcy, to know about the best practices of filing for bankruptcy.

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